Corporate Landscape in India: Key Developments and Sectoral Insights for 2025
India’s corporate landscape in early 2025 reflects a dynamic interplay of growth, challenges, and strategic shifts across various sectors
Banking Sector Challenges
India’s banking sector is grappling with rising bad debts and subdued credit growth. Major private banks have reported increases in loan defaults, particularly in unsecured loans like credit cards and personal loans. Amitabh Chaudhry of Axis Bank anticipates subdued deposit and credit growth until 2026, while HDFC Bank prepares for higher defaults with a 17% rise in provisions. The economic situation is strained by high inflation and slowdowns in consumption and credit growth, leading the Reserve Bank of India to maintain high interest rates. In response, the central bank introduced measures to inject liquidity into the banking system. 
Fintech Innovations
In the fintech sector, Cred, a prominent platform backed by Tiger Global and Peak XV, has become the first fintech firm to offer access to India’s central bank digital currency (CBDC), the e-rupee. Initially, the Reserve Bank of India’s pilot for the e-rupee permitted only banks to provide access. However, in April 2024, payment firms were also allowed to participate. Cred plans to introduce access to its e-rupee wallet to select users, with YES Bank facilitating the issuance of e-rupee tokens. Despite an initial surge, e-rupee transactions have since declined, highlighting the challenge central banks face in promoting digital currencies globally. 
Energy Sector Developments
In the energy sector, Power Grid Corporation of India Ltd. experienced a decline of 1.11% in its share prices, closing at 283.85 Indian rupees. This occurred despite a positive trading session for the broader market, with the BSE SENSEX Index rising by 0.71% to 75,901.41. The company’s shares are currently 22.49% below their 52-week high of 366.20 rupees, reached on September 25th. However, Power Grid’s performance was better than some of its competitors, with Tata Power Co. Ltd. dropping by 1.58% to 346.35 rupees and Gujarat Industries Power Co. Ltd. falling by 2.34% to 181.45 rupees. 
Metals and Mining Sector Outlook
Hindustan Zinc, India’s largest refined metal producer, anticipates strong revenue and profit growth in 2025 due to increased production and higher metal prices. The company, which is majority-owned by Vedanta, exceeded analysts’ profit expectations for the third quarter. Misra stated that after completing maintenance work in the first three quarters, the company aims for a highly productive fourth quarter. Projects aimed at enhancing smelting efficiency and productivity are expected to drive this growth. Misra predicts zinc prices will rise from $2,800 to between $2,850-$2,950 per ton and silver will trade at $30-$31 per ounce. Additionally, Hindustan Zinc plans to resume discussions with the Indian government about splitting into two units, a proposal previously rejected. The company also intends to focus on critical minerals and is considering acquiring assets in Southeast Asia and neighboring regions. 
Automotive Industry Challenges
Volkswagen India’s air shipments of car components were briefly detained by Mumbai customs due to a $1.4 billion tax demand, causing delays in spare part supplies at dealerships. This disruption comes as the German carmaker strives to boost sales in the competitive Indian market, which involves new launches and planned investments. India accused Volkswagen of evading taxes by misclassifying imports and underpaying tax on components for its Audi, VW, and Skoda brands. Skoda Auto Volkswagen India maintains compliance with all laws and is cooperating with authorities. The detainment affected over 50 shipments, primarily containing spare parts for luxury brands like Audi, Lamborghini, and Porsche, which were held for about two weeks. Despite gradual release, some dealerships still face delays. The exact value of the delayed shipments remains unclear, but the company’s 2024 imports amounted to $770 million, with 4% transported by air. Volkswagen holds less than a 2% share of India’s 4-million-unit car market. 
Information Technology Sector Growth
In the information technology sector, Tech Mahindra added 6,653 employees in the second quarter of the fiscal year 2025, leading among top Indian IT firms with prominent hirings of over 2,000 freshers. The company’s total headcount now stands at 154,273. Tech Mahindra reported a net profit increase of 153.1% year-on-year and revenue growth of 3.5%, surpassing market expectations. Attrition rates slightly rose during this period. 
Initial Public Offerings (IPOs) Surge
India’s primary market is set to witness substantial activity in 2025, with 75 companies preparing to launch initial public offerings (IPOs), potentially raising Rs 2.5 lakh crore. This ambitious pipeline underscores the continued momentum in the equity capital market, following a record-setting 2024. Noteworthy upcoming IPOs include HDB Financial Services, targeting Rs 12,500 crore, Hexaware Technologies with a proposed Rs 9,950 crore offering, and LG Electronics India aiming to raise Rs 15,000 crore. Analysts predict the number of new-age companies listing in 2025 will double compared to 2024, further enhancing investor interest. 
Stock Market Insights
In the stock market, Bharti Airtel, Ambuja Cements, and Cipla have been identified as long-term stock picks for 2025 by Axis Securities. These recommendations reflect investor confidence in these companies’ growth prospects amid a dynamic market environment.
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